- GPW Benchmark will later this year become the administrator of exchange index of the Main Market, NewConnect and TBSP, including WIG20, mWIG40 and sWIG80
- Take-over of index administration is a part of alignment with the requirements of the EU Benchmark Regulation
- Development of an index and benchmark reference centre is a part of the GPW Group’s strategy
Changes to the management system of exchange indices arise from Regulation (EU) 2016/1011 of the European Parliament and of the Council of 8 June 2016 on indices used as benchmarks in financial instruments and financial contracts or to measure the performance of investment funds (BMR), which took effect at the beginning of 2018. It requires an adequate framework index calculation framework in line with the requirements of the Regulation, as well as transparent and compliant index calculation processes from the collection of input data to index publication.
The GPW Group has completed in-depth analyses of alignment with the BMR requirements and decided to transfer the calculation of stock and bond indices to GPW Benchmark S.A. GPW Benchmark S.A. was established in 2017 as an index and reference benchmark competence centre in line with the GPW Group strategy which provides for expansion of offered information services. GPW Benchmark is responsible for WIBID and WIBOR administration, which are at an advanced stage of harmonisation with the BMR requirements.
“The transfer of competences regarding capital market indices including WIG, WIG20, mWIG40, sWIG80, TBSP.Index is a natural consequence of our recent initiatives under the updated strategy #GPW2022, which include the integration of competences within GPW Group companies. Further to its role as a reference rate fixing organiser, GPW Benchmark extends its competences to include capital market index administration,” said Jacek Fotek, Vice-President of GPW.
The GPW Group is working to spin off exchange index administration processes to be taken over by GPW Benchmark and to file an application for authorisation as their administrator with the Polish Financial Supervision Authority. According to the work plan, GPW Benchmark is planning to take over the operational functions of administrator by the end 2019.
GPW Benchmark will take over the administration of all 40 GPW indices, including the leading indices WIG20, mWIG40, sWIG80 and NCIndex, as well as TBSP.Index (currently owned by BondSpot). Alignment with the BMR requirements will help to optimise processes involved in index development and management, ensure a high quality of indices and supervision over the calculation methods, as well as transparent data available to investors.
“We have developed the necessary infrastructure, know-how and local solutions for GPW Benchmark to take over all responsibilities for exchange index calculation and publication. We will soon lodge the relevant application with the Polish Financial Supervision Authority. We expect to get their approval this autumn and to take over as exchange index administrator later this year,” said Zbigniew Minda, President of GPW Benchmark.
The integration of reference benchmark competences within a member of a capital group is a European trend. It is the operating principle of specialised members of exchange groups in Germany (STOXX) and the United Kingdom (FTSE Russell, IBA).
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The Warsaw Stock Exchange Group (GPW Group) operates trading platforms for shares, Treasury and corporate bonds, derivatives, electricity and gas, and calculates the benchmarks WIBOR and WIBID. The index agent FTSE Russell classifies the Polish capital market as a Developed Market since 2018. The markets operated by the GPW Group are the biggest in Central and Eastern Europe. For more information, visit www.gpw.pl
GPW Benchmark is a member of the GPW Group established in Q1 2017. The core business of GPW Benchmark will be to organise and, in the future, to administer WIBID and WIBOR reference rate fixings. GPW Benchmark will also be a Calculation Agent.